Investing
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Micron Technology (MU) is emerging as a key AI stock, often overshadowed by Nvidia, AMD, and Broadcom.
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MU’s fiscal Q4 2025 guidance projects $8.7 billion in revenue and $1.16 EPS, reflecting strong AI-driven demand.
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Micron’s focus on high-bandwidth memory and storage positions it as a critical enabler of AI applications.
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The Top AI Stock to Buy in 2025?
When investors think of artificial intelligence (AI) stocks, names like Nvidia (NASDAQ:NVDA), Advanced Micro Devices (NASDAQ:AMD), or Palantir Technologies (NASDAQ:PLTR) often dominate the conversation.
However, Micron Technology (NASDAQ:MU) is quietly positioning itself as a critical player in the AI ecosystem, driven by its leadership in high-bandwidth memory (HBM) and storage solutions.
With its recent fiscal fourth-quarter 2025 guidance update projecting revenue of $8.7 billion and earnings of $1.16 per share, Micron is signaling robust demand for its memory chips, particularly in AI-driven applications.
Could Micron be the best AI stock to buy now, outshining even Nvidia? Here’s why Micron deserves a closer look.
The Unsung Hero of AI Infrastructure
Micron’s role in AI is less flashy than Nvidia’s graphics processing units (GPUs) but no less essential. As AI models grow in complexity, they require vast amounts of memory to process data efficiently, especially at the edge — such as in smartphones, autonomous vehicles, and IoT devices.
Micron’s HBM3E chips, which offer over 20 times the bandwidth of standard memory modules while consuming 30% less power, are powering cutting-edge AI applications. At CES 2025, Nvidia’s CEO Jensen Huang highlighted Micron’s memory chips as integral to the new GeForce RTX 50 Blackwell gaming platform, underscoring their importance in high-performance computing.
As AI moves beyond data centers to consumer devices, Micron’s solutions are becoming indispensable.
Riding the AI Memory Boom
The demand for memory and storage is skyrocketing as AI workloads expand. Micron’s fiscal first-quarter 2025 results showed a staggering 400% year-over-year increase in data center revenue, which now accounts for over half of its total revenue. This growth is fueled by the need for HBM in AI training and inference tasks.
The company’s updated Q4 guidance reflects continued strength, with projected revenue growth of 29.4% year-over-year for the quarter, according to analyst estimates. Wall Street forecasts Micron’s total addressable market for HBM to reach $100 billion by 2030, a sixfold increase from today. This positions Micron to capture significant market share as AI adoption accelerates.
Navigating Short-Term Challenges
Despite its strong fundamentals, Micron has faced volatility. Its stock dropped 38% from its June 2024 peak after guidance for the second quarter suggested a 9% sequential revenue decline, largely due to weaker demand in PCs and smartphones. It has yet to regain those heights, though it has been one of the best-performing semiconductor stocks in 2025.
However, this dip masks Micron’s long-term potential. The company’s NAND business, which has been impacted by these market trends, is expected to recover as edge computing and AI converge.
Moreover, Micron’s stock is trading at a compelling valuation, with a price-to-earnings (P/E) ratio of 10 for next year’s earnings and a price-to earnings growth (PEG) ratio of 0.18, indicating it may be significantly undervalued relative to its growth prospects. This makes it an attractive buy for patient investors.
A Strategic Edge in AI Innovation
Micron’s innovation extends beyond HBM. Its 1-gamma LPDDR5X memory, the world’s first of its kind, is designed for AI-powered smartphones, enabling faster and smarter processing at the edge. Partnerships with industry leaders like Nvidia for H200 and GH200 accelerators further solidify Micron’s role in the AI supply chain.
As AI evolves from generative models to agentic systems — used in coding, customer service, and robotics — Micron’s ability to provide high-capacity, energy-efficient memory will be critical. The company’s focus on both data center and edge applications gives it a diversified revenue stream, reducing reliance on any single market.
Key Takeaways
Micron Technology is arguably the best AI semiconductor stock to buy today due to its pivotal role in the memory and storage market, which is foundational to AI’s growth. Unlike Nvidia, which focuses on GPUs, Micron addresses a less saturated but equally critical segment of the AI ecosystem.
Its HBM3E chips and LPDDR5X technology position it to meet the exploding demand for AI infrastructure, from data centers to edge devices. With a low valuation, strong revenue growth, and a massive addressable market, Micron offers a compelling risk-reward profile.
While short-term headwinds exist, its strategic partnerships and innovation make it a standout choice for investors betting on AI’s long-term dominance.
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